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Revenue & reporting

The Law Foundation of Ontario’s main source of revenue is interest received from lawyers’ and paralegals’ mixed trust accounts. Other sources of revenue are cy-près awards and investment income.

Main sources of revenue

The Law Foundation of Ontario’s main source of revenue is interest received from lawyers’ and paralegals’ mixed trust accounts. Other sources of revenue are cy-près awards and investment income.

Mixed trust accounts

Cy-près awards

Mixed trust accounts

The Law Foundation of Ontario is entrusted by law with the interest from mixed trust accounts held by lawyers and paralegals. By law, the Foundation gives 75% of this revenue after operating expenses to Legal Aid Ontario. The Foundation uses the remaining 25% to make innovative grants to improve access to justice across Ontario.

Legal professionals routinely hold money in trust for clients – in connection, for example, with the sale of a house or the settlement of a lawsuit. If the funds are small in amount or will be held in trust for a short time and are unlikely to generate any net interest for the individual client, the funds may be placed in a mixed trust account. Programs that use income from the professions’ trust accounts to advance access to justice exist throughout Canada and the United States and in several other jurisdictions.

The Law Foundation of Ontario’s revenues from the interest on mixed trust accounts can be highly variable. Two broad factors determine revenues in any given year: mixed trust balances and interest rates.

The Foundation negotiates agreements with major banks and other institutions authorized to hold lawyers’ and paralegals’ mixed trust accounts as to the interest to be earned on those accounts. The agreements take into account the significant monetary value of mixed trust accounts and the societal value of the Foundation’s work. Terms can vary significantly over time and further influence the Foundation’s revenues.

The Law Foundation of Ontario receives funds from cy-près awards from some class action lawsuits. Courts make cy-près awards when it is not practical to distribute all the proceeds of a class action to individual plaintiffs. In such a case, courts have the power to direct the money to meritorious organizations.

Cy-près awards have been a relatively recent and significant source of funds for access to justice projects. Many courts have approved The Law Foundation of Ontario as a fitting and accountable recipient of cy-près awards. The Foundation created the permanent Access to Justice Fund (ATJF) in 2009 to provide grants from the cy-près awards we receive. The Foundation distributes any cy-près award it receives in strict compliance with all attached terms and conditions.

Class actions that have resulted in a cy-près award to the ATJF to date are:

Lawyers and paralegals must report annually on each mixed trust account. It is important to direct the financial institution to forward all interest earned from a mixed trust account to The Law Foundation of Ontario.

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